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ASEAN FRAMEWORK AGREEMENT
FOR THE INTEGRATION OF PRIORITY SECTORS
WE, the Heads of Government/State of Brunei Darussalam, the Kingdom of
Cambodia, the Republic of Indonesia, the Lao People's Democratic Republic
(hereinafter referred to as "Lao PDR"), Malaysia, the Union of Myanmar, the
Republic of the Philippines, the Republic of Singapore, the Kingdom of
Thailand and the Socialist Republic of Viet Nam, Member States of the
Association of South East Asian Nations (hereinafter collectively referred to as
"ASEAN" or "Member States" or singularly as "Member State");
RECALLING the Declaration of ASEAN Concord II (Bali Concord II) adopted
during the 9th ASEAN Summit in Bali, Indonesia on 7 October 2003, pursuant to
which ASEAN is committed to deepen and broaden its internal economic
integration and linkages, with the participation of the private sector, to realise
an ASEAN Economic Community;
REAFFIRMING that the ASEAN Economic Community shall be the end-goal of
ASEAN economic integration as outlined in the ASEAN Vision 2020;
REITERATING that the ASEAN Economic Community will result in ASEAN
becoming a single market and production base, turning the diversity that
characterises the region into opportunities and business complementation to
make ASEAN a more dynamic and stronger segment of the global supply chain
and the world economy;

DESIRING to combine the economic strengths of Member States in key
strategic sectors for regional cohesiveness and enhanced global
competitiveness by accelerating the integration of the eleven priority sectors in
the Bali Concord II and such other sectors as may be agreed upon as
necessary,
HAVE AGREED AS FOLLOWS:

PART I
OBJECTIVE, DEFINITION AND APPLICATION
Article I
Objective

The objective of this ASEAN Framework Agreement for the Integration of
Priority Sectors (hereinafter referred to as the "Framework Agreement") is to
identify measures to be implemented, with clear timelines, in a mutually
beneficial manner, by Member States in respect of the priority sectors identified
in paragraph 1 of Article 2 of this Framework Agreement so as to enable the
progressive, expeditious and systematic integration of these sectors in ASEAN.
Article 2
Definition

For the purposes of this Framework Agreement:
1.

"priority sectors" means:
(a)

the 11 sectors listed below:
(i)
(ii)
(iii)
(iv)
(v)
(vi)
(vii)
(viii)
(ix)
(x)
(xi)

agro-based products;

air travel;
automotives;
e-ASEAN;
electronics;
fisheries;
healthcare;
rubber-based products;
textiles and apparels;
tourism;
wood-based products; and

(b)

such other sectors as may be identified by the Ministers
responsible for ASEAN economic integration under Articles 19
and 20 of this Framework Agreement.

(c)

Air travel shall be deemed to refer to air transport.


2.

"ASEAN Sectoral Integration Protocol" means the individual integration
protocol for each priority sector which identifies the common and specific
measures for each priority sector.

3.

"ASEAN-6" means Brunei Darussalam,
Philippines, Singapore and Thailand

4.

"CLMV" means Cambodia, Lao PDR, Myanmar, and Viet Nam.

Indonesia,

Malaysia, the


Article 3
Applicability to the ASEAN Sectoral Integration Protocols
The provisions of this Framework Agreement shall apply to each priority sector
and be deemed to be included in each ASEAN Sectoral Integration Protocol
unless provided otherwise therein.
PART II
LIBERALISATION
Article 4
Trade in Goods
1.

2.

Member States shall eliminate all Common Effective Preferential Tariff
for the ASEAN Free Trade Area (CEPT-AFTA) tariffs in relation to
products (other than those in the sensitive, highly sensitive and general
exception lists) covered by the individual ASEAN Sectoral Integration
Protocols, except those listed in accompanying negative lists to the
Protocols, which in total for each Member State shall not exceed 15% of
the total product list appearing as Annex XII to this Framework

Agreement, by:
(a)

1 January 2007 for ASEAN-6; and

(b)

1 January 2012 for CLMV

Member States shall implement the following actions in relation to nontariff measures (hereinafter referred to as "NTMs") to ensure
transparency, in accordance with the timelines indicated:
(a)

establish the database of ASEAN NTMs by 30 June 2004;

(b)

establish criteria to identify NTMs that are barriers to trade by 30
June 2005; and


(c)

establish a definitive work programme for the removal of NTMs
that are barriers to trade by 31 December 2005.

3.

Member States shall adopt the WTO Agreement on Import Licensing
Procedures and develop common implementation guidelines appropriate
for ASEAN for this purpose by 31 December 2004.

4.

Member States shall endeavour to expand the coverage of the ASEAN
Integration System of Preferences (AISP) Scheme by including products
in the priority sectors.

Article 5
Trade in Services
Member States shall integrate trade in services by:

(a)

setting clear targets and schedules for progressive liberalisation
for each round of negotiations towards achieving freer flow of
trade in services earlier than 2020;

(b)

accelerating the service liberalisation for the priority sectors by
2010;

(c)

accelerating
the
development
of
Mutual
Recognition
Arrangements (hereinafter referred to as "MRAs") by 1 January

2008;

(d)

applying the ASEAN-X formula; and

(e)

promoting joint ventures and cooperation, including third country
markets.
Article 6
Investment

Member States shall undertake the following measures:
(a)

Accelerate the opening up of sectors currently in the Sensitive
List (hereinafter referred to as "SL") by transferring these sectors
into the Temporary Exclusion List (hereinafter referred to as "TEL")
under the Framework Agreement on the ASEAN Investment Area

(AIA), using the ASEAN-X formula, beginning 2004.

(b)

Reduce restrictive investment measures in the SL beginning 2004
and complete the progressive elimination of restrictive investment
measures in the TEL by 31 December 2010 for ASEAN-6, 2013
for Viet Nam and 2015 for Cambodia, Lao PDR and Myanmar.

(c)

Identify programmes and activities to promote investments in
ASEAN by 31 December 2005.

(d)

Promote manufacturing processes in ASEAN to take advantage
of their comparative strengths through:
(i)


the establishment of a network of ASEAN free trade zones
to facilitate outsourcing activities beginning 2005; and

(ii)

(e)

undertaking more efficient joint ASEAN facilitation and
promotion measures to promote foreign direct investments
on an ongoing basis.

Promote and facilitate joint/cross border investments
manufacturing activities, on an ongoing basis, through:

in

(i)

special incentives, where appropriate, to be given by
CLMV for investments from ASEAN; and

(ii)

special measures, where appropriate, to be given by
ASEAN-6 to promote and facilitate relocation of investment
to CLMV especially for labour intensive manufacturing
activities.
PART III
TRADE AND INVESTMENT FACILITATION
Article 7
Rules of Origin

Member States shall, by 31 December 2004, improve the CEPT Rules of Origin
by:
(a)

making them more transparent, predictable and standardised,
taking into account the best practices of other Regional Trade
Agreements, including the rules of origin of the WTO; and

(b)

adopting substantial transformation as an alternative criteria for
conferring origin status.

Article 8
Customs Procedures
Member States shall implement the following measures, in accordance with the
timelines indicated, so as to expedite customs clearance and simplify customs
procedures:
(a)

Extend the application of the ASEAN Harmonised Tariff
Nomenclature (AHTN) for extra-ASEAN trade on an on-going
basis .

(b)

Simplify, improve and harmonise customs declaration forms by 31
December 2005.

(c)

Ensure full implementation of the Green Lane System for CEPT
products or similar system at entry points of all Member States by
31 December 2004.

(d)

Develop common implementation guidelines, by 31 December
2004, to fulfill the obligations of the WTO Agreement on Customs
Valuation.

(e)

Each ASEAN customs authority to adopt a service commitment
(client charter) by 31 December 2004; and

(f)

Develop the Single Window approach, including the electronic
processing of trade documents at national and regional level by
31 December 2005.
Articles
Standards and Conformance

Member States shall take the following steps to accelerate the development of
MRAs and harmonise product standards and technical regulations:
(a)

Accelerate the implementation and where appropriate the
development of sectoral MRAs for priority sectors beginning 1
January 2005.

(b)

Encourage domestic regulators to recognise test reports issued
by testing laboratories which are accredited by national
accreditation bodies in ASEAN that are signatories to
International Laboratory Accreditation Cooperation (ILAC) and
Asia-Pacific Laboratory Accreditation Cooperation (APLAC)
MRAs.

(c)

Set, by 31 December 2005, clear targets and schedules for
harmonisation of standards in the priority sectors wherever
required. Where international standards are not available and
when requested by industry, align national standards among
Member States.

(d)

Harmonise and/or develop technical regulations as appropriate,
for national application by 31 December 2010.

(e)

Ensure compliance with the requirements of the WTO
Agreements on Technical Barriers to Trade and the Application of
Sanitary and Phyto-Sanitary Measures.

(f)

Explore the development of ASEAN policy on standards and
conformance to further facilitate the realisation of the ASEAN
Economic Community, beginning 2005.
Article 10
Logistics Services

Expedite the development of integrated transport logistics services within
ASEAN through:
(a)

Promotion of efficient door-to-door cargo transport and crossborder
transport
facilitation
through
the
expeditious
implementation of the ASEAN Framework Agreement on the
Facilitation of Goods in Transit, and the ASEAN Framework
Agreement on Multimodal Transport;

(b)

Improvement of land transport network infrastructures and
services to achieve better inter-connectivity, inter-operability and
inter-modality with the national, regional and international
maritime and air transport gateways.

(c)

Strengthening intra-ASEAN maritime and shipping transport
services; and

(d)

Establishment of enabling and conducive policy environment for
increased private sector involvement and/or public-private
partnerships in the development of transport infrastructure and
the provision and operation of transport logistics facilities and
services.

Article 11
Facilitation of Travel in ASEAN
Member States shall:
(a)

harmonise procedures for the issuance of visas to international
travelers in ASEAN by 31 December 2004; and

(b)

provide visa exemption for intra-ASEAN travel by ASEAN
nationals by 2005.

Article 12
Movement of Business Persons, Experts, Professionals,
Skilled Labour and Talents
Member States shall, taking into account their respective domestic laws and
regulations:
(a)

develop an ASEAN agreement to facilitate the movement of
business persons, including the adoption of an ASEAN Travel
Card, by 31 December 2005;

(b)

develop an ASEAN agreement to facilitate the movement of
experts, professionals, skilled labour and talents by 31 December
2005; and

(c)

accelerate completion of MRAs to facilitate free movement of
experts, professionals, skilled labour and talents in ASEAN by 31
December 2008.
PART IV
PROMOTION AND MONITORING
Article 13
Trade and Investment Promotion

Member States shall, beginning 2005 and on an ongoing basis, work in close
cooperation with the ASEAN Business Advisory Council (ASEAN-BAC), the
ASEAN Chambers of Commerce and Industry (ASEAN-CCI), and relevant
industry clubs/associations to:
(a)

intensify joint intra-ASEAN and extra-ASEAN trade promotion
efforts;

(b)

organise regular private sector driven ASEAN selling and buying
missions;

(c)
(d)

assist CLMV in organising promotional activities; and
undertake more effective joint ASEAN facilitation and promotion
measures and develop new sources of inward foreign direct
investment, particularly from potential countries such as the
People's Republic of China, India and the Republic of Korea.

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Article 14
ASEAN Trade and Investment Statistics
Member States shall establish an effective system to monitor ASEAN trade and
investments through:
(a)

provision of updates to the ASEAN Secretariat of the latest trade
(goods and services) and investment statistics; and

(b)

preparation of consolidated industry profiles, by the respective
associations, which, inter alia, cover information such as
production capacity and product range.

PARTV
OTHER AREAS FOR INTEGRATION
Article 15
Intellectual Property Rights
Member States shall expand the scope of ASEAN intellectual property rights
cooperation beyond trademarks and patents to include cooperation in
copyrights information exchange and enforcement by 31 December 2004.

Article 16
Industrial Complementation
Member States shall promote complementation among ASEAN manufacturers,
as applicable, through:
(a)

identification and development of specialisation of production
processes, research and development (R&D), and testing
facilities based on comparative advantage of individual Member
State; and

(b)

development
of
guidelines
on
promoting
outsourcing
arrangements among Member States, as applicable.
Article 17
Human Resource Development

Member States shall cooperate to develop and upgrade skills and capacity
building through joint training and workshops.

PART VI
GENERAL PROVISIONS
Article 18
General Exceptions
Nothing in this Framework Agreement shall prevent any Member State from
taking actions and adopting measures which it considers necessary for the
protection of its national security, the protection of public morals, the protection
of human, animal or plant life and health, and the protection of articles of artistic,
historic and archaeological value.

Article 19
Institutional Arrangement
1.

The Ministers responsible for ASEAN Economic Integration, with the
assistance of the Senior Economic Officials (SEOM), shall oversee,
monitor and/or coordinate the implementation of this Framework
Agreement.

2.

The ASEAN Secretariat shall:

3.

(a)

provide support to the Ministers and the SEOM for supervising,
coordinating and reviewing the implementation of this Framework
Agreement; and

(b)

monitor and regularly report to the SEOM on the progress in the
implementation of this Framework Agreement.

Member States shall cooperate with the ASEAN Secretariat in the
performance of its duties.

Article 20
Review
The Ministers responsible for ASEAN Economic Integration shall meet as and
when necessary to review this Framework Agreement for the purpose of
considering further measures and/or other sectors for priority integration or any
other relevant matters as may be agreed.

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Article 21
Sectoral Integration Protocols and Annexes
The ASEAN Sectoral Integration Protocols attached to this Framework
Agreement as Annexes (I) to (XI) and the total product list attached as Annex
(XII) shall form an integral part of this Framework Agreement.

Article 22
Consultations
Member States shall accord adequate opportunity for consultations regarding
any representations made by another Member State with respect to any matter
that would affect the implementation of this Framework Agreement.

Article 23
Dispute Settlement
The provisions of the ASEAN Protocol on Enhanced Dispute Settlement
Mechanism, done at Vientiane, Lao PDR on the 29th day of November 2004,
shall apply to disputes arising under this Framework Agreement.
Article 24
Relation to other Agreements
1.

Except as provided in paragraph 2 hereof, this Framework Agreement or
any action taken under it shall not affect or nullify the rights and
obligations of a Member State under existing agreements or
international conventions to which it is also a party.

2.

The provisions in this Framework Agreement shall prevail over the rights
and obligations in other relevant ASEAN agreements to the extent that
the same subject matter is governed by this Framework Agreement.
Article 25
Final Provisions

1.

The provisions of this Framework Agreement may be modified through
amendments mutually agreed upon in writing by all Member States.

2.

This Framework Agreement shall be deposited with the SecretaryGeneral of ASEAN, who shall furnish a certified copy to each Member
State.

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Article 26
Entry into Force
1.

This Framework Agreement shall enter into force on 31 August 2005.
Notwithstanding the specified date of entry into force, Member States
undertake to carry out the obligations which arise prior to the date of
entry into force of this Framework Agreement in accordance with the
timelines indicated herein and the Roadmaps attached to the ASEAN
Sectoral Integration Protocols as Appendices.

2.

Member States undertake to complete their internal procedures of
ratification for the entry into force of this Framework Agreement.

3.

Each Member State shall upon the completion of its internal procedures
of ratification of this Framework Agreement notify the ASEAN Secretariat
in writing.

IN WITNESS WHEREOF, WE have signed this ASEAN Framework Agreement
for the Integration of Priority Sectors.
DONE at Vientiane, Lao PDR this 29th day of November 2004, in single copy, in
the English Language.

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For Brunei Darussalam

HAJI HASSANAL BOLKIAH
Sultan of Brunei Darussalam
For the Kingdom of Cambodia

SAMDECH HUN SEN
Prime Minister
For the Republic of Indonesia

DR. SUSILO BAMBANG YUDHOYONO
President
For the Lao People's Democratic Republic

BOUNNHANG VORACHITH
Prime Minister

For Malaysia

DATO' SERI ABDULLAH AHMAD BADAWI
Prime Minister
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For the Union of Myanmar

LIEUTENANT GENERAL SOE WIN
Prime Minister
For the Republic of the Philippines

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/

GLORIA MACAPAGAL-ARROYO
President
For the Republic of Singapore

LEE HSIEN LOONG
Prime Minister
For the Kingdom of Thailand

DR. THAKSIN SHINAWATRA
Prime Minister
For the Socialist Republic of Viet Nam

PHAN VAN KHAI
Prime Minister

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